When you are starting off your new business enterprise, it seems logical that you will want to stay below the radar at the beginning and you will want to try to run your business with the minimum amount of fuss. This is why many people choose to be a sole trader because they feel that this protects them in this difficult business climate, but this is totally untrue. Unfortunately they are going to have to experience the downsides to being a sole trader or being part of a partnership before they learn that it’s much better to register the business. They wrongfully assume that business registration is one of the many ways that the government and the associated departments try to make life more difficult for them, but the opposite is in fact true.
Registering a new company in Singapore using the relevant agency is the one way to protect yourself, your business and your family from any liabilities that might be incurred. Registering your new company allows your liability to be limited to what the business owns and nothing more. It is important to be able to separate your business liabilities from your personal ones, so that in the event that your business goes through financial difficulties, the courts can only take what the business owns and not what you own. If the benefits of registering your new business still haven’t cleared you then maybe the following benefits for doing so can help you to make a more informed and smarter business choice.
– You pay less tax – New business owners are frequently surprised by this fact and they wrongfully think that if they are a sole trader or they are part of a partnership, that they will pay less tax than that of a registered company. It is actually the opposite and a registered business gets to enjoy many tax breaks that different countries provide. This is one way to make your business stand out from the crowd and you can use tax deductions for things like, staff training, digital marketing and any other company expenses which means that you will be effectively getting all of this money back. You are not afforded this advantage when you continue to trade as a sole trader. You will enjoy a lower tax rate than a registered company which will be lower than that of an individual. It seems too good to be true, but it is fact.
– You limit your liability – unfortunately people who are sole traders or who engage in a partnership end up suffering as a business runs into difficulties further down the road. If they are unable to meet their obligations then the court may award damages and therefore instruct that their home and their personal belongings be confiscated in order to pay the money that is owed. When you register your company, the liability lies with the company and with no one else. In the unlikely event that financial difficulties are experienced, then only the assets that the company owns, can be touched and nothing more. This means that your family home is safe as well as the family car and personal bank accounts. This is the peace of mind that you need going into business and so it makes perfect sense to register your going concern.
– You enjoy the discounts – Wholesalers often offer special terms and conditions to those businesses that are registered and so your business will get to take advantage of certain discounts that will not be available to you if you don’t. The wholesaler needs to have confidence in your business and the need to know that you’re still going to be trading this time it’s month or next year. They will not want to extend credit terms to a business that is not yet registered.
Hopefully now you can appreciate the benefits of registering your new business and you will do so as soon as you possibly can. By doing this, you are not only protecting yourself but your other family members as well as your employees. Business registration is there to protect you and so you should do everything that you can to make it all happen.